China's major stock indices have adjusted their constituents beginning from Monday to incorporate more new economy companies.
The adjustments involve several major indices from the Shanghai, Shenzhen, and Beijing stock exchanges, including the CSI 300, CSI A50, CSI A500, SSE 50, SSE 180, SZSE Component Index, ChiNext Index, and BSE 50.
Some of the indices are closely monitored by investors and linked to funds each with a total scale reaching hundreds of billions of yuan.
"A-share indices mainly adjust their constituent stocks in June and December, with the proportion of adjustments usually within 10 percent. This approach not only maintains the stability of the indices but also enhances their representativeness," said Zhang Shiyue, index fund manager with the CIB Fund Management Co., Ltd.
According to experts, the adjustment aligns with the development of China's economic structure.
"With the transformation and upgrading of China's economic structure in recent years, the number of listed companies in the new economy sector, such as information technology, medicine, healthcare, and advanced manufacturing, has been increasing across the three A-share stock exchanges. As a result, the constituent stocks of the indices have been adjusted accordingly. Increasing the proportion of listed companies in relevant industries can better reflect the latest trends in China's market, guide market funds to invest, and more effectively support technological innovation and the development of new quality productive forces," said Tian Lihui, dean with the Nankai University Institute of Finance and Development.
China's major stock indices adjusted to include more new economy companies
China's major stock indices adjusted to include more new economy companies
